BGL partners Ebonyi State on N20bn bond offer

ByPeter Egwuatu
The N20 billion bond issuance transaction recently consummated by Ebonyi State would create abundant opportunities for development in the state, the Group Managing Director/CEO, BGL It will be recalled recently, the signing of the N16.5bn Ebonyi State bond took place in Abuja.

The Securities and Exchange Commission (SEC/ recently gave its final nod of approval to the transaction at the Completion Board Meeting which held at the Kano hall of the Transcorp Hilton Abuja.

This transaction, according to Okumagba, places BGL Plc (joint issuing house) at the top position in terms of Bond Issuance transactions in Nigeria having participated in the Imo, Kwara, Niger, Bayelsa and Kaduna State Bonds.

“BGL is a forward thinking organization. We see ourselves not only as an investment bank, but as partners in progress. This fund raising exercise will create a lot of opportunities for development in the state,’’ he said

The BGL boss added that ‘’the government can now focus on financing projects that will bring about fiscal development in the state. Ebonyi State has a lot of potentials in agriculture and mining. The government will channel these funds to the development of these sectors”

According to the Executive Governor of Ebonyi State, Martin Elechi, “Ours is a state blessed with a lot of resources. We are tired of the clamour for federal allocation by the states.

We have decided to look inwards. Ebonyi State is positioned in an agricultural region, and is one of the leading producers of rice, yam, potatoes, maize and other agricultural products. We also have several solid mineral resources, but little large scale commercial mining.

Despite these vast resources, lack of infrastructure has restricted growth of mining, agriculture and other sectors of the State.

Our government has however embarked on several incentives to increase the number of investors in Agro-allied sector, mining and other sectors. These incentives need funding. With BGL and our other financial partners; we have been able to raise the required funding to bring these initiatives to life”

The Ebonyi State bond is a N20 billion Medium Term Note Issuance Programme. The N16.5bn raised so far is the first tranche of this bond offer.

The offer runs at 13.5% at a fixed rate with a five- year tenure. The proceeds of the bond issuance will be used for repayment of outstanding bank facilities, Ebonyi State Regional Water Schemes, Ebonyi Roads & Bridges of Unity, Ebonyi Rice World Project and Ebonyi State International Market, Abakaliki. The offer opened on the 30th September, 2010 and closed on the same day.